No More Development?

No More Development?

DEVELOPMENT by Janet Leiser | Senior Editor

Land use experts say the business community should vote against Florida Hometown Democracy - one of the biggest threats to development in the state. Property insurance and taxes also pose problems.

Development in Florida will come to a screeching halt if voters approve the Florida Hometown Democracy initiative in 2008, according to two lawyers who sounded the alarm at a recent meeting of the Urban Land Institute-Tampa Bay.

If the referendum passes, all proposed projects that require a change to local comprehensive growth management plans will have to go before the voters for approval, even those that meet all state requirements could be killed or face costly delays waiting for election time.

Tampa land-use lawyer Ron Weaver says: "Can you imagine the extent of trying to get all your neighbors and everyone else to the voting booth?"

Some counties see more than a thousand comp plan amendments annually, he says. Palm Beach County, for example, made about 1,500 changes to its comp plan in 2005.

Rebecca O'Hara, deputy general counsel to the Tallahassee-based Florida League of Cities, says the initiative is a huge threat to the development community.

After all, who doesn't want a say in what happens near their neighborhood? And how can you vote against democracy?

But she says the referendum's outcome will be much different than what's intended.

"Let's face it, most comprehensive land amendments don't deal with whether a building on the corner can go from five stories to eight stories," O'Hara says. "That's more in the nature of a rezoning. Comprehensive land amendments are things that are going to make your eyes glaze over, like whether or not your capital improvement elements meet the elements of state law.

"The threat of Hometown Democracy is it will most likely bring comprehensive planning as we know it to a screeching halt."

That's especially significant, she says, considering all the recent changes to the state's growth management laws that require school, water and transportation concurrency.

To fight Hometown Democracy, O'Hara and Weaver urged the business community to vote in November for a proposed law that would require changes to the state's constitution be approved by a minimum of 60% of the voters, instead of the existing 51%.

If that change is adopted, Hometown Democracy would need the approval of 60% of the voters when it goes to referendum in 2008.

Other threats to the development community are rising property taxes, costly and often unavailable property insurance and school concurrency, says Weaver, adding, "School concurrency is a huge issue, as is the Florida Hometown Democracy threat as to what the real estate industry is all about."

Weaver says "the famous Mel Martinez memo" advised the Orange County Commission to reject the building of new residences in parts of the county with inadequate schools. The court has since upheld a community's ability to stop construction for lack of schools, even when a development meets all state legal requirements.

The effects of school concurrency, passed in the 2005 legislative session, probably won't be felt for a couple more years because local governments have until December 2008 to adopt the elements of school concurrency in comp plans, O'Hara says.

Governments then have five years to fully implement it on a district-wide basis, she says, adding, "Once you hit that five-year mark and school concurrency has to be applied on a district-wide basis, coupled with the fact you have the class size reduction and you might have Hometown Democracy in place by then, it's not going to be a pretty sight."

The legislative session

Weaver, O'Hara and fellow guest speaker, Rep. Trey Traviesa, a Hillsborough County Republican, also discussed how the business community fared in the last legislative session.

The Florida Legislature didn't pass property tax reform or add portability even though those issues were discussed, O'Hara says. The legislators did fund a study of the issue by the state Department of Revenue, and Gov. Bush appointed a committee in June to study the issue and make recommendations in 2007.

"It probably will be one of the foremost discussions with respect to property tax reform in the coming year, as well as whether or not to increase existing homestead exemption from its current level of $25,000," O'Hara says. "It will continue to be a huge course of debate thru the '07 session and probably beyond that as well."

Traviesa says Florida was one of the first states in the nation to tackle the private property rights issue raised in the U.S. Supreme Court's Kelo decision.

Government is no longer able to take private property under eminent domain because of slum or blight and preservation or enhancement of a tax base, Traviesa says. And local government can no longer take a property to eliminate or abate a public nuisance.

"That was likened to killing a mosquito with a shot gun," Traviesa says. "There are a lot of ways and methods local government has to abate public nuisances. The taking of private property doesn't belong in that category.

"We successfully closed the door in Florida opened by the Kelo decision, which scared a lot of us, and restored the proper balance between the public need and individual freedom."

Florida Legislative Update

It takes time and plenty of reading the fine prints to really see the impacts of each year's legislative session.

Tampa land-use attorney Ron Weaver of Stearns Weaver Miller Weissler Alhadeff & Sitterson PA says the 2006 Florida legislative session reflected a growing support for property tax relief.

Senate Bill 1268 lowered the minimum age from 70 to 65 and raised the household income limitation to $23,463 from $12,000 for property owners to qualify for the homestead tax deferral program, Weaver says. The bill also reduces the maximum interest rate on deferred property taxes to 7% from 9%. Although the bill will reduce government cash flow in the short term, it's expected to increase in the long-term with the accrued interest.

The Legislature also changed the law to allow a person to be added to a deed without affecting the homestead exemption status.

An overview of other legislation from Weaver's office:

GROWTH MANAGEMENT: The development of regional impact (DRI) process can be costly for a developer. House Bill 683 modifies procedures related to DRIs. Five new exemptions from DRI review were created for self-storage warehousing without retail or other services; nursing homes or assisted living facilities; developments within an airport master plan adopted into a comp plan; campus master plan; and specific area plans prepared to statutory plans.

REAL ESTATE: Senate Bill 1948 adds disclosure requirements for the sale of coastal real property seaward of the coastal construction line. Sellers must disclose property that is subject to coastal erosion, property may be subject to federal, state or local environmental laws regulating coastal property and the purchaser may obtain additional information from the Department of Environmental Protection regarding shoreline and erosion.

Senate Bill 152 provides that county property appraisers inspect real property every five years instead of every three years.

INSURANCE INDUSTRY: Senate Bill 1980 appropriates $715 million for Citizens Property Insurance Corp. to offset the 2005 deficit. Estimated annual premium surcharges for property insurance policy holders reduced to 2.5% from 11%. Effective in July 2011, property valued at $1 million or more will no longer be covered by Citizens.

It also states that Citizens' rates cannot be competitive with authorized insurers.

- Janet Leiser